Dolce, Wyndham deal makes ‘perfect sense’
02 FEBRUARY 2015 9:39 AM
Dolce President and CEO Steve Rudnitsky finds himself back in the Wyndham Hotels Group fold following the latter’s $57-million acquisition. That’s not the only reason why the two companies are a complementary fit, he said.
ROCKLEIGH, New Jersey—The $57-million acquisition of Dolce Hotels and Resorts by Wyndham Hotel Group is a marriage of familiar bedfellows, according to the former’s president and CEO, Steve Rudnitsky.
The man himself personifies the connection. Before joining Dolce in November 2008, Rudnitsky served in the top post at Wyndham for six years.
“I’m very happy to be back under the Wyndham fold for the transitional period,” he told Hotel News Now on Monday morning. “I’ve always maintained a good and healthy relationship with (Wyndham Worldwide Chairman and CEO) Stephen Holmes. … We’ve always kept in contact. This is a little bit of six degrees of separation.”
That contact made Wyndham a natural target when Dolce, via Morgan Stanley, quietly began exploring strategic opportunities to add capital and grow the family-owned company.
“Deals develop in lots of different ways,” said Geoff Ballotti, president and CEO of Wyndham Hotel Group, during a break while conducting a meet-and-greet in Dolce’s Rockleigh, New Jersey, headquarters. “They’re often the result of personal relationships and familiarity. That was certainly the case here with Dolce. Obviously our chairman Steve Holmes and I know Steve Rudnitsky. We’ve worked with Steve for years. ... We’ve kept in touch. We’re certainly familiar with the brand. It’s a great band that our (mergers and acquisitions) team always had in its sights.”
Dolce executives were not necessarily seeking an outright sale, Rudnitsky said.
“We were selectively having conversations though Morgan Stanley with various investment organizations. Really because of our relationship with Wyndham and their interest in understanding and getting into more of the group business, we started having more substantive conversations. And it just made perfect sense for both parties.”
Dolce operates 24 meetings-oriented hotels comprising more than 5,500 rooms in seven countries in Europe and North America. The group has four additional projects in the pipeline:
- a 180-room conference hotel near Versailles, France;
- a 140-room lifestyle conference hotel in Annecy, France;
- a 202-room lifestyle conference hotel near Cincinnati, Ohio; and
- a 200-room urban lifestyle hotel in Palm Springs, California.
Rudnitsky said Dolce “hopefully” will announce one or two more projects in the coming weeks.
Wyndham Hotels Group had 7,590 hotels comprising 655,300 rooms as of the third quarter 2014, the majority of which are select-service properties that lack significant meetings footprint.
The upper-upscale Dolce brand will join Wyndham’s existing stable of 14 brands, which include: Wyndham Grand Hotels and Resorts (upper upscale); Wyndham Hotels and Resorts (upper upscale); Wyndham Garden Hotels (upper midscale); Tryp by Wyndham (upper midscale); Wingate by Wyndham (midscale); Hawthorn Suites by Wyndham (midscale); Microtel by Wyndham (economy); Ramada Worldwide (midscale); Baymont Inn & Suites (midscale); Days Inn (economy); Super 8 (economy); Howard Johnson (midscale); Travelodge (economy); and Knights Inn (economy).
Wyndham management will maintain other aspects of Dolce, Rudnitsky said.
“The thing we fundamentally agreed on was the Dolce infrastructure needed to be nimble and very responsive to our customer because of our size,” he said. “(Holmes) really wanted to maintain and reinforce the scale and the infrastructure with Wyndham.
“It’s really kind of marrying the best of both worlds.”
Dolce also helps Wyndham expand its management platform by nearly 40%, according to a news release.
“My team over the past six years, I like to think we’ve really translated Dolce from a family-owned company that owns its own properties to an asset-light brand that really became recognized in the hospitably industry with a meetings brand. … This move by Wyndham will preserve the nimbleness of the Dolce management style that really I believe makes us so responsive to our property owners,” Rudnitsky said.
It’s yet unclear as to whether Dolce will move its headquarters from Rockleigh some 40 miles down U.S. Interstate 287 to Parsippany, New Jersey, he said.
As to his future with the company, Rudnitsky likely will part ways with Wyndham once again.
“I’m really focused on successfully completing this transaction, which obviously is a very time-consuming endeavor. I now am very focused on making absolutely certain that I support the Wyndham folks and the Dolce people that I’ve overseen for the past six years to a very successful transition. I am sure things will unfold for me in due course.
“I will have other opportunities in the world of business and hopefully as a president or CEO of another operating company.”